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OIG Releases Semi-Annual Report to Congress

Published on 

Wednesday, December 6, 2023

 | OIG 

The OIG released its semiannual report to Congress on December 1st. In a related fact sheet they indicated the report highlights over $3.44 billion in expected recoveries resulting from HHS-OIG audits and investigations conducted during fiscal year (FY) 2023.

 

This report “describes OIG’s work on significant problems, abuses, deficiencies, remedies, and investigative outcomes relating to the administration of HHS programs and operations during the reporting period. In this report, we present OIG expected recoveries, criminal and civil actions, and other statistics as a result of our work for the semiannual reporting period of April 1, 2023-September 30, 2023. We also provide data for accomplishments for fiscal year (FY) 2023 and highlight some of our work completed during this semiannual reporting period.”

 

For this article, we will focus on one report completed by the OIG that impacts inpatient claims in acute care hospitals. In September 2023, OIG released the report Medicare Improperly Paid Acute-Care Hospitals for Inpatient Claims Subject to the Post-Acute-Care Transfer Policy Over a 4-Year Period, but CMS’s System Edits Were Effective in Reducing Improper Payments by the End of the Period (A-09-23-03016), September 2023.

 

About the Post-Acute-Care Transfer Policy

Medicare makes the full Medicare Severity Diagnosis-Related Group (MS‑DRG) payment to an acute‑care hospital that discharges an inpatient to home or certain types of health care institutions but pays an acute-care hospital that transfers an enrollee to post-acute care a per diem rate for each day of the enrollee’s stay in the hospital.

 

Post-acute care settings that are subject to this policy includes transfers to:

  • Inpatient rehabilitation facilities and units (Patient discharge status code 62 or planned acute care hospital inpatient readmission patient status code 90),
  • Long-term care hospitals (Patient Status Code 63 or planned acute care hospital inpatient readmission Patient Status Code 91),
  • Psychiatric hospitals and units (Patient discharge status code 65 or planned acute care hospital inpatient readmission patient status code 93),
  • Cancer hospitals (Patient discharge status code 05 or planned acute care hospital inpatient readmission patient status code 85),
  • Children’s hospitals (Patient discharge status code 05 or planned acute care hospital inpatient readmission patient status code 85),
  • Skilled nursing facility (Patient discharge status code 03 or planned acute care hospital inpatient readmission patient status code 83),
  • Hospice care at home (Patient status code 50) or Hospice Medical Facility (Certified) providing hospice level of care (Patient status code 51)
  • Home under a written plan of care for the provision of home health (HH) services from a HH agency and those services occurs within 3 days after the date of discharge (Patient discharge status code 06 or planned acute care hospital inpatient readmission patient status code 86).

 

MS-DRGs Subject to the Post-Acute-Care Transfer Policy in the CMS FY 2024

  • 764: The overall number of MS-DRGs for FY 2024
  • 282: The number of MS-DRGs subject to this policy
  • 148: The number of surgical MS-DRGs subject to this policy
  • 134: The number of medical MS-DRGs subject to this policy

 

Specific regulations regarding the transfer policies can be found in Chapter 4 of the Medicare Claims Processing Manual, section 40.2.4.

 

Why OIG Did The Audit

OIG notes that compliance with the transfer policy has been an issue for a long time and this audit was conducted to evaluate whether Medicare properly paid acute-care hospital claims subject to the policy for claims with dates of service from January 1, 2019, through December 31, 2022.

 

About the Audit

  • $198 million: The Medicare Part A payments covered in the audit.
  • 12,133: the number of inpatient claims subject to the transfer policy.
  • Claims included in the audit had a discharge status code to home or certain types of health care institutions on the claim.
  • OIG used Medicare enrollee information to identify post-acute services settings that began on the same day as discharge for SNF claims, and within 3 days of inpatient discharge for home health claims.

 

What OIG Found

Medicare improperly paid $41.4 million to acute-care hospitals for inpatient claims subject to the post-acute-care transfer policy. This amount of money represents the difference between the amount of the full MS-DRG payments and the amount that would have been paid if the per diem rates had been applied.

 

These improper payments were made because CMS’s system edits were not effective in detecting inpatient claims subject to the transfer policy in October and November 2019 and from October 2020 through March 2022. However, after CMS fixed the edits in April 2022, improper payments significantly decreased through the end of the audit period.

OIG Recommendations to CMS

  1. Direct the Medicare contractors to recover from acute-care hospitals the portion of the $41.4 million in identified overpayments for our audit period that are within the 4-year reopening period; and
  2. Instruct the Medicare contractors to notify appropriate providers so that the providers can exercise reasonable diligence to identify, report, and return any overpayments in accordance with the 60-day rule. CMS concurred with our recommendations.

 

The Rest of the Story

Hospice was added to the list of post-acute care (PAC) settings for which this transfer policy applies in 2019. The Medicare Payment Advisory Commission (MedPAC) noted in a January 14, 2021 mandated report that the addition of transfers to hospice resulted in about $300 million savings to Medicare in FY 2019 and there has been no evidence of discernible changes in timely access to hospice care.

 

In addition to OIG Report A-09-23-03016, there are two other active OIG Work Plan items related to the Post-Acute-Care Transfer Policy.

 

Work Plan Item: Medicare Hospital Payments for Claims Involving the Acute- and Post-Acute Care Transfer Policies

OIG is reviewing Medicare hospital discharges that were paid a full MS-DRG payment when the patient was transferred to a facility covered by the acute and post-acute transfer policies where Medicaid paid for the service. They are also assessing the transfer policies to determine if they are adequately preventing cost shifting across healthcare settings. https://oig.hhs.gov/reports-and-publications/workplan/summary/wp-summary-0000445.asp

 

Work Plan Item: Impact of Expanding the Hospital Transfer Payment Policy for Early Discharges to Post Acute Care

OIG is determining how the hospital transfer policy for early discharges to post acute care (PAC) would financially affect Medicare and hospitals if it were expanded to include all MS-DRGs. https://oig.hhs.gov/reports-and-publications/workplan/summary/wp-summary-0000585.asp

 

Note, the expected report issue date for both Work Plan items is in FY 2024.

 

Moving Forward

Here are a few tips to ensure accurate discharge status coding, billing, and appropriate payments:

  • Make sure your coders know and understand correct use of the discharge status code,
  • Make sure coders know where in the record to find the most accurate information concerning discharge status and whom to ask if they have questions,
  • Have a system in place to follow up after discharge to verify what post-discharge care a patient received,
  • Have processes in place for timely communication between case management, coders, and billers concerning discharge status,
  • Have a procedure to handle Medicare requests to change discharge status (this can occur when Medicare receives claims from other hospitals or post-acute care providers for services immediately following a hospital discharge), and
  • Perform periodic claims audits for correct discharge status.

 

Resources

 

Article Author: Beth Cobb, RN, BSN, ACM, CCDS
Beth Cobb, RN, BSN, ACM, CCDS, is the Manager of Clinical Analytics at Medical Management Plus, Inc. Beth has over twenty-five years of experience in healthcare including eleven years in Case Management at a large multi-facility health system. In her current position, Beth is a principle writer for MMP’s Wednesday@One weekly e-newsletter, an active member of our HIPAA Compliance Committee, MMP’s Education Department Program Director and co-developer of MMP’s proprietary Compliance Protection Assessment Tool.

This material was compiled to share information.  MMP, Inc. is not offering legal advice. Every reasonable effort has been taken to ensure the information is accurate and useful.